Impermissible Deduction?

LoriP

Good morning!

Here is my question: Can you deduct a full day’s pay from an exempt employee’s paycheck for not showing up to work on a day where the agency was open only ½ a day due to inclement weather?

Here is the background:

1. Agency opened at noon due to inclement weather.
2. Employees were told that admin leave would be given for the morning hours (8:00 am – 12:00 pm) if the employees reported for work at noon. This policy applies to both exempt and non-exempt employees.
3. Exempt employees are to use a PTO day if they did not report to work.
4. Agency policy is to deduct PTO in increments of 8.00 days – there is no partial application of leave time.
5. Some exempt employees do not have PTO days, and could not report to work on the day of inclement weather. For these employees, a day of “Leave Without Pay” is to be applied, deducting the equivalent of an 8 hour day from their salary.

Any help you can provide would be greatly appreciated!

Thanks,
Lori

Down_the_Middle

LoriP:
Your questions suggests that there is no history of doing this in the past..... A bit unusual?? If that's the case, then you'll be in a position to establish some future precedence. Is Admin Leave w/or w/o pay? It sounds as tho exempt staff is required to use PTO and presumably this also applies to N/E staff. since your practice of not paying exempt staff if PTO is exhausted was used, it would make sense to require the use of PTO if it was available.
I would personally handle the day as a day w/pay for all exempt personnel; regardless of the number of hours worked that day.

LoriP

Thanks for your response,

Yes, our admin. leave is with pay. My concern is those exempt employees who do not have any PTO to cover the day - their salary will be reduced for that day missed, and I am concerned that this reduction would remove exempt status for these employees.

Thank you,
Lori

Myrna Minkoff

The DOL recently issued an opinion letter on salary docking for weather related absences. I haven't read it, but it may be useful to you.

[url]http://www.dol.gov/esa/whd/opinion/FLSA/2005/2005_10_28_46_FLSA.pdf[/url]

LoriP

Yes, it seems that this letter creates some confusion with the Letter issued by the Department on October 24th discussing when the office remains open during inclement weather.

I think the confusing thing is that the office was closed for the first part of the day, and then opened. Letter FLSA2005-41 states that an exempt employee who has no accrued benefits in their leave bank do not have to be paid when they fail to report to work due to such circumstances as a heavy snow, when the office is open.

FLSA 2005-46 states that "an employer may not make deductions 'for absences occasioned by the employer or by the operating requirements of the business.' If the employer closes operations due to a weather related emergency or other disaster for less than a full workweek, then the employer must pay an exempt employee 'the full salary for any week in which the employee performs any work without regard to the number of hours or days worked,' because 'deductions may not be made for time when work is not available.'

So, if work was not available for the first 1/2 of the day, is work available for that day (ie open) or is it closed due to weather? This is the threshold question in getting to which letter rationale applies.

If you have any other ideas or thoughts, I would be grateful to hear them,
Thanks,
Lori

HRCalico

Hi, Lori - I didn't know you were still around! I declared myself non-essential personnel last Monday and stayed home (but I'm non-exempt, so that was easy). I just hope the roads are OK in the morning - it's blowing awfully hard tonight.

I'm not sure if this will help or not. In our latest NE law letter, the Ask Mark section states -
If the workplace closure is your decision, the Fair Labor Standards Act requires you to fully compensate any exempt employee who is ready and able to work. Improper salary deductions could jeopardize an employee’s exemption.

I have not read the opinion letters mentioned, and I think the above statement is an over-simplification. As mentioned, you will probably set a precedent, so you do want to proceed cautiously. Here is my opinion - you won't get in trouble for being too cautious or too generous. I think I would quietly not deduct the exempt personnel who did not report at noon and give them a full paycheck, as I would for exempt employees who did report at noon but did not have PTO to cover the morning.

Then again, I am out of the non-profit world where I don't have to worry about pinching every penny. Then again times two, if employees could not make it at noon, they were not "ready and able to work". Seriously, if I were you, I'd give Mark Schorr (of the aforementioned Ask Mark fame) a call at (402) 476-1000 and ask him to clarify what he wrote in the newsletter. I can really see this both ways.

Good luck and stay warm!